The world's second-largest economy, Japan, is suffering from a savage collapse in her export trade – a trend that seems set to precipitate a near-collapse in the car industry and which is driving the nation to the bottom of the growth league among the advanced industrial nations.
A 49.4 per cent plunge in Japanese exports in February, compared with the situation a year ago, is the fourth successive month of record export declines. It is also the sharpest decline in at least 30 years.
Exports to the rest of Asia retreated by 46 per cent and to EU nations by 55 per cent. Shipments of motor vehicles were down 64 per cent, with those to the US tumbling 71 per cent. Total exports to America fell by 58 per cent.
Japanese manufacturers, as is seen graphically at their UK operations, have reacted rapidly to the downturn, slashing their stocks and throttling back output far more quickly than in previous recessions.
Honda reported a 43 per cent drop in global output, and Nissan, part-owned by Renault, has seen its worldwide production decline by 51 per cent. Toyota is expecting to make its first loss since 1950.
The slump has meant that Japan's total industrial production fell by a record 10 per cent in January. In a shocking set of forecasts released earlier this week in preparation for the G20 summit in London next week, the International Monetary Fund forecast that Japan's economy would shrink by 5.8 per cent this year and 0.2 per cent in 2010 – by far the worst performance of any G7 nation in the post-war era.
With Germany suffering similar problems, the world's champion exporting and manufacturing nations are finding that what were once formidable strengths are turning violently against them as more indebted nations slow their purchases of cars, information technology and machinery, and world trade slows down.
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